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Exhibit 4.2
TOMAX TECHNOLOGIES, INC.
INVESTOR RIGHTS AGREEMENT
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DATED JULY 13, 2000
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TOMAX TECHNOLOGIES, INC.
INVESTOR RIGHTS AGREEMENT
This Investor Rights Agreement dated July 13, 2000 is among TOMAX
TECHNOLOGIES, INC., a Utah corporation (the "COMPANY"), ORACLE CORPORATION, a
Delaware corporation (the "INVESTOR"), and ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇, and ▇▇▇▇▇ LOW (collectively, the "EXISTING HOLDERS"). Capitalized terms
used herein are defined as set forth in Section 8.
The Company, the Investor and the Existing Holders are parties to a
Stock Purchase Agreement dated July 13, 2000 (the "Stock Purchase Agreement") in
which the Investor agrees to purchase 421,585 shares (the "PREFERRED SHARES") of
Series A Convertible Preferred Stock of the Company (the "PREFERRED STOCK") from
the Company and 634,518 shares (the "COMMON SHARES") of Common Stock of the
Company (the "COMMON STOCK") from the Existing Holders and other shareholders of
the Company.
The parties desire to enter into the agreements set forth herein
with respect to the Preferred Shares and the Common Shares.
Now, therefore, the parties agree as follows:
1. Registration Rights
1.1 REQUEST FOR REGISTRATION.
(a) GENERAL. If the Company shall receive at any time after the
earlier of (i) the first anniversary of the First Closing (as defined in the
Stock Purchase Agreement) of the Investor's purchase of the Preferred Shares and
the Common Shares and (ii) 180 days after the effective date of the first
registration statement for a public offering of securities of the Company (other
than a registration statement relating either to the sale of securities to
employees of the Company pursuant to a stock option, stock purchase or similar
plan or a SEC Rule 145 transaction), a written request from the Holders of a
majority of the Registrable Securities then outstanding (on an as converted to
Common Stock basis) that the Company file a registration statement under the
Securities Act pursuant to this Section 1.1(a) covering the registration of at
least 25% of the Registrable Securities outstanding on the date hereof (or any
lesser percentage if the anticipated aggregate offering price to the public
exceeds $2,500,000), then the Company shall:
(i) within 10 days of the receipt thereof, give written notice of
such request to all Holders; and
(ii) use its best efforts to effect, within 90 days of the receipt
of such request, the registration under the Securities Act of all Registrable
Securities that the Holders request to be registered within 20 days of the
mailing of such notice by the Company;
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provided, however, that the Company shall not be obligated to effect any such
registration, qualification or compliance pursuant to this Section 1.1(a) after
the Company has effected two registrations pursuant to this Section 1.1(a) and
such registrations have been declared or ordered effective.
(b) FORM S-3. In case the Company shall receive from any Holder or
Holders a written request or requests that the Company effect a registration on
Form S-3 under the Securities Act and any related qualification or compliance
with respect to all or a part of the Registrable Securities owned by such Holder
or Holders pursuant to this Section 1.1(b), the Company will:
(i) promptly give written notice of the proposed registration, and
any related qualification or compliance, to all other Holders; and
(ii) as soon as practicable, effect such registration and all such
qualifications and compliances as may be so requested which would permit or
facilitate the sale and distribution of all or such portion of such Holder's or
Holders' Registrable Securities as are specified in such request, together with
all or such portion of the Registrable Securities of any other Holder or Holders
joining in such request as are specified in a written request given within 20
days after receipt of such written notice from the Company;
provided, however, that the Company shall not be obligated to effect any such
registration, qualification or compliance pursuant to this Section 1.1(b):
(x) if Form S-3 is not available for such offering by the Holders;
(y) if the Holders, together with the holders of any other
securities of the Company entitled to inclusion in such registration, propose to
sell Registrable Securities and such other securities (if any) at an aggregate
price to the public of less than $2,000,000; or
(z) if the Company has, within the 12-month period preceding the
date of such request, already effected one registration on Form S-3 for the
Holders pursuant to this Section 1.1(b).
Registrations effected pursuant to this Section 1.1(b) shall not be counted as
demands for registration effected pursuant to Section 1.1(a).
(c) UNDERWRITING. If Holders initiating the registration request
under Section 1.1(a) or (b), (the "INITIATING HOLDERS") intend to distribute the
Registrable Securities covered by their request by means of an underwriting,
they shall so advise the Company as a part of such request and the Company shall
include such information in the written notice referred to in Section 1.1(a)(i)
or (b)(i), respectively. The underwriter will be selected by the Company and
shall be reasonably acceptable to a majority in interest of the Initiating
Holders. In such event, the right of any Holder to include its Registrable
Securities in such registration shall be conditioned upon such Holder's
participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting (unless otherwise mutually agreed by
a majority in interest of the Initiating Holders and such Holder) to the extent
provided in this
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Section 1.1(c). All Holders proposing to distribute their securities through
such underwriting shall (together with the Company as provided in Section
1.3(e)) enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting. Notwithstanding any
other provision of this Section 1.1, if the underwriter advises the Initiating
Holders and the Company in writing that marketing factors require a limitation
of the number of shares to be underwritten, then the Company shall so advise all
Holders of Registrable Securities that would otherwise be underwritten pursuant
hereto, and the number of shares of Registrable Securities that may be included
in the underwriting shall be allocated among all Holders thereof, including the
Initiating Holders, in proportion (as nearly as practicable) to the amount of
Registrable Securities owned by each Holder; provided, however, that the number
of Registrable Securities to be included in such underwriting shall not be
reduced unless all securities which are not Registrable Securities are first
entirely excluded from the underwriting. The Company shall have no obligation
with respect to any registration requested pursuant to this Section 1.1 if, due
to the operation of this Section 1.1(c), the number of shares or the anticipated
aggregate offering price of the Registrable Securities to be included in the
registration does not equal or exceed the number of shares or the anticipated
aggregate offering price required to originally trigger the Company's obligation
to initiate such registration as specified in this Section 1.1.
(d) DELAY RIGHT. Notwithstanding anything in this Section 1.1, if
the Company shall furnish to Holders requesting a registration statement
pursuant to this Section 1.1 a certificate signed by the Chief Executive Officer
of the Company stating that, in the good faith judgment of the Board of
Directors of the Company, such filing could reasonably be expected to have a
material adverse effect on any plan or proposal by the Company with respect to
any material transaction that the Company is at that time actively pursuing and
it is therefore essential to defer the filing of such registration statement,
the Company shall have the right to defer taking action with respect to such
filing for a period of not more than 90 days after receipt of the request of the
Initiating Holders; provided, however, that the Company may not utilize the
right granted by this Section 1.1(d) more than once in any 12 month period.
(e) LIMITATIONS. Notwithstanding anything in this Section 1.1, the
Company shall not be obligated to take any action to effect any registration
pursuant to this Section 1.1:
(i) During the 180-day period commencing on the consummation of a
Qualifying IPO;
(ii) If the Company delivers notice to the Holders within 30 days of
any registration request communicating its intent to file a registration
statement for a Qualifying IPO within 90 days; or
(iii) As to any Holder requesting registration for a sale not
pursuant to an underwriting, if the Registrable Securities requested to be
registered by such holder can be sold in the following 3-month period without
registration in compliance with Rule 144 under the Securities Act and such sale
is not restricted by Section 1.10 or otherwise.
1.2 COMPANY REGISTRATION.
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(a) INCLUSION OF REGISTRABLE SECURITIES. If (but without any
obligation to do so) the Company proposes to register (including for this
purpose a registration effected by the Company for stockholders other than the
Holders) any of its stock or other securities under the Securities Act in
connection with the public offering of such securities solely for cash (other
than a registration relating solely to the sale of securities to participants in
a Company stock plan, a registration on any form that does not include
substantially the same information as would be required to be included in a
registration statement covering the sale of the Registrable Securities or a
registration in which the only Common Stock being registered is Common Stock
issuable upon conversion of debt securities that are also being registered), the
Company shall, at such time, promptly give each Holder written notice of such
registration. Upon the written request of each Holder given within 20 days after
mailing of such notice by the Company, the Company shall, subject to the
provisions of Section 1.1(b), cause to be registered under the Securities Act
all of the Registrable Securities that each such Holder has requested to be
registered.
(b) UNDERWRITING REQUIREMENTS. In connection with any offering
involving an underwriting of Common Stock, the Company shall not be required
under this Section 1.3 to include any of the Holders' securities in such
underwriting unless they accept the terms of the underwriting as agreed upon
between the Company and the underwriters selected by it (or by other persons
entitled to select the underwriters), and then only in such quantity as the
underwriters determine in their sole discretion will not jeopardize the success
of the offering by the Company. If the underwriters, in their sole discretion,
determine and advise in writing the Company and the Holders of the Registrable
Securities requesting participation in such registration that in their good
faith judgment the number of shares of Registrable Securities and the other
securities requested to be registered under this Section 1.3 exceeds the maximum
amount of Common Stock which can be marketed (giving first priority to Common
Stock to be issued by the Company in such underwriting, but giving priority to
the shares requested to be included in the offering pursuant to this Section 1.3
over all other shares proposed to be included therein), then the Company shall
be required to include in the offering only that number of shares of Common
Stock, including Registrable Securities, which the underwriters determine in
their sole discretion will not jeopardize the success of the offering and the
securities so included shall be apportioned pro rata among the participating
Holders according to the total amount of securities entitled to be included
therein owned by each participating Holder or in such other proportions as shall
mutually be agreed to by such participating Holders. For purposes of such
apportionment, for any participating Holder that is a partnership or
corporation, the partners, retired partners and stockholders of such Holder, or
the estates and family members of any such partners and retired partners and any
trusts for the benefit of any of the foregoing Persons shall be deemed to be a
single participating Holder, and any pro-rata reduction with respect to such
participating Holder shall be based upon the aggregate amount of shares carrying
registration rights owned by all Persons included in such participating Holder.
1.3 OBLIGATIONS OF THE COMPANY. Whenever required under this Section
1 to effect the registration of any Registrable Securities, the Company shall,
as expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration statement under the
Securities Act with respect to such Registrable Securities and use its best
efforts to cause such registration
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statement to become effective, and, upon the request of the Holders of a
majority of the Registrable Securities registered thereunder, keep such
registration statement effective for a period of up to 90 days or until the
distribution contemplated in the Registration Statement has been completed;
provided, however, that (i) such 90-day period shall be extended for a period of
time equal to any period that the Holder refrains from selling any securities
included in such registration at the request of an underwriter or the Company
due to a need, in accordance with Section 1.3(f), to prepare and provide a
supplemented or amended prospectus; and (ii) in the case of any registration of
Registrable Securities on Form S-3 which are intended to be offered on a
continuous or delayed basis, such 90-day period shall be extended, if necessary,
to keep the registration statement effective until all such Registrable
Securities are sold, provided that Rule 415, or any successor rule under the
Securities Act, permits an offering on a continuous or delayed basis, and
provided further that applicable rules under the Securities Act governing the
obligation to file a post-effective amendment permit, in lieu of filing a
post-effective amendment that (x) includes any prospectus required by Section
10(a)(3) of the Securities Act or (y) reflects facts or events representing a
material or fundamental change in the information set forth in the registration
statement, the incorporation by reference of information required to be included
in (x) and (y) above to be contained in periodic reports filed pursuant to
Section 13 or 15(d) of the Exchange Act in the registration statement.
(b) Prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
registration statement.
(c) Furnish to the Holders such numbers of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as they may reasonably request in order
to facilitate the disposition of Registrable Securities owned by them.
(d) Use its best efforts to register and qualify the securities
covered by such registration statement under such other securities or blue sky
laws of such jurisdictions as shall be reasonably requested by the Holders;
provided that the Company shall not be required in connection therewith or as a
condition thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions, unless the Company is
already subject to service in such jurisdiction and except as may be required by
the Securities Act.
(e) In the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and customary
form, with the managing underwriter of such offering. Each Holder participating
in such underwriting shall also enter into and perform its obligations under
such an agreement.
(f) Notify each Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not
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misleading in the light of the circumstances then existing. Such obligation to
continue for ninety (90) days.
(g) Cause all such Registrable Securities registered pursuant to
this Section 1 to be listed on each securities exchange or market on which
similar securities issued by the Company are then listed.
(h) Provide a transfer agent and registrar for all Registrable
Securities registered pursuant hereunder and a CUSIP number for all such
Registrable Securities, in each case not later than the effective date of such
registration.
1.4 EXPENSES. All expenses (other than underwriting discounts,
commissions and external counsel for the Holders) incurred in connection with
registrations, filings or qualifications pursuant to Section 1.1 or 1.2,
including (without limitation) all registration, filing and qualification fees,
printers' and accounting fees and fees and disbursements of counsel for the
Company, shall be borne by the Company; provided, however, that the Company
shall not be required to pay for any expenses of any registration proceeding
begun pursuant to Section 1.1(a) if the registration request is subsequently
withdrawn at the request of the Holders of a majority of the Registrable
Securities to be registered, in which case all participating holders shall bear
such expenses unless the Holders of a majority of the Registrable Securities
agree to forfeit their right to one demand registration pursuant to Section
1.1(a); and provided, however, that if at the time of such withdrawal, the
Holders have learned of a material adverse change in the condition, business or
prospects of the Company that was not known to the Holders at the time of their
request and have withdrawn the request with reasonable promptness following
disclosure by the Company of such material adverse change, then the Holders
shall not be required to pay any of such expenses and shall retain their rights
pursuant to Section 1.1(a) without diminution.
1.5 FURNISHING INFORMATION. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to this Section 1 with
respect to the Registrable Securities of any selling Holder that such Holder
shall furnish to the Company such information regarding itself, including
without limitation the Registrable Securities held by it, and the intended
method of disposition of such securities as shall be required to effect the
registration of such Holder's Registrable Securities.
1.6 DELAY OF REGISTRATION. No Holder shall have any right to obtain
or seek an injunction restraining or otherwise delaying any such registration as
the result of any controversy that might arise with respect to the
interpretation or implementation of this Section 1.
1.7 INDEMNIFICATION. In the event any Registrable Securities are
included in a registration statement under this Section 1:
(a) To the extent permitted by law, the Company agrees to indemnify
and hold harmless each Holder, any underwriter (as defined in the Securities
Act) for such Holder and each person, if any, who controls such Holder or
underwriter within the meaning of the Securities Act or the Exchange Act,
against any losses, claims, damages or liabilities (joint or several) to which
they may become subject under the Securities Act, the Exchange Act or other
federal or
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state law, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any of the following statements,
omissions or violations (collectively a "VIOLATION"): (i) any untrue statement
or alleged untrue statement of a material fact contained in such registration
statement, including any preliminary prospectus or final prospectus contained
therein or any amendments or supplements thereto, (ii) the omission or alleged
omission to state therein a material fact required to be stated therein, or
necessary to make the statements therein not misleading, or (iii) any violation
or alleged violation by the Company of the Securities Act, the Exchange Act, any
state securities law or any rule or regulation promulgated under the Securities
Act, the Exchange Act or any state securities law; and the Company will pay to
each such Holder, underwriter or controlling person, as incurred, any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that this Section 1.7(a) shall not apply to amounts paid in settlement of any
such loss, claim, damage, liability or action if such settlement is effected
without the consent of the Company (which consent shall not be unreasonably
withheld), nor shall the Company be liable in any such case for any such loss,
claim, damage, liability or action to the extent that it arises out of or is
based upon a Violation which occurs in reliance upon and in conformity with
written information furnished expressly for use in connection with such
registration by any such Holder, underwriter or controlling person.
(b) To the extent permitted by law, each selling Holder agrees to
indemnify and hold harmless the Company, each of its directors, each of its
officers who has signed the registration statement, each person, if any, who
controls the Company within the meaning of the Securities Act, any underwriter,
any other Holder selling securities in such registration statement and any
controlling person of any such underwriter or other Holder, against any losses,
claims, damages or liabilities (joint or several) to which any of the foregoing
persons may become subject, under the Securities Act, or the Exchange Act or
other federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based upon any
Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished by such Holder expressly for use in connection with such registration;
and each such Holder will pay, as incurred, any legal or other expenses
reasonably incurred by any person intended to be indemnified pursuant to this
Section 1.7(b), in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the indemnity
agreement contained in this Section 1.7(b) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder, which consent shall
not be unreasonably withheld; provided, that, in no event shall any indemnity
under this Section 1.7(b) exceed the gross proceeds from the offering received
by such Holder, except in the case of willful fraud by such Holder.
(c) Promptly after receipt by an indemnified party under this
Section 1.7 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 1.7, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an
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indemnified party (together with all other indemnified parties that may be
represented without conflict by one counsel) shall have the right to retain one
separate counsel, with the fees and expenses to be paid by the indemnifying
party, if representation of such indemnified party by the counsel retained by
the indemnifying party would be inappropriate due to actual or potential
differing interests between such indemnified party and any other party
represented by such counsel in such proceeding. The failure to deliver written
notice to the indemnifying party within a reasonable time of the commencement of
any such action, if prejudicial to its ability to defend such action, shall
relieve such indemnifying party of liability to the indemnified party under this
Section 1.7 to the extent (and only to the extent) of such prejudice, but the
omission so to deliver written notice to the indemnifying party will not relieve
it of any liability that it may have to any indemnified party otherwise than
under this Section 1.7.
(d) If the indemnification provided for in this Section 1.7 is held
by a court of competent jurisdiction to be unavailable to an indemnified party
with respect to any loss, liability, claim, damage or expense referred to
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party hereunder, shall contribute to the amount paid or payable by such
indemnified party as a result of such loss, liability, claim, damage or expense
in such proportion as is appropriate to reflect the relative fault of the
indemnifying party on the one hand and of the indemnified party on the other in
connection with the statements or omissions that resulted in such loss,
liability, claim, damage or expense as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(e) Notwithstanding the foregoing, to the extent that the provisions
on indemnification and contribution contained in the underwriting agreement
entered into in connection with the underwritten public offering are in conflict
with the foregoing provisions, the provisions in the underwriting agreement
shall control.
(f) The obligations of the Company and Holders under this Section
1.7 shall survive the completion of any offering of Registrable Securities in a
registration statement under this Section 1, and otherwise.
1.8 REPORTS UNDER EXCHANGE ACT. With a view to making available to
the Holders the benefits of Rule 144 promulgated under the Securities Act and
any other rule or regulation of the SEC that may at any time permit a Holder to
sell securities of the Company to the public without registration or pursuant to
a registration on Form S-3, the Company agrees to:
(a) make and keep public information available, as those terms are
understood and defined in SEC Rule 144, at all times after 60 days after the
effective date of the first registration statement filed by the Company for the
offering of its securities to the general public so long as the Company remains
subject to the periodic reporting requirements under Sections 13 or 15(d) of the
Exchange Act;
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(b) take such action, including the voluntary registration of its
Common Stock under Section 12 of the Exchange Act, as is necessary to enable the
Holders to utilize Form S-3 for the sale of their Registrable Securities, such
action to be taken as soon as practicable after the end of the fiscal year in
which the first registration statement filed by the Company for the offering of
its securities to the general public is declared effective;
(c) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and
(d) furnish to any Holder, so long as the Holder owns any
Registrable Securities, forthwith upon request (i) a written statement by the
Company that it has complied with the reporting requirements of SEC Rule 144 (at
any time after 90 days after the effective date of the first registration
statement filed by the Company), the Securities Act and the Exchange Act (at any
time after it has become subject to such reporting requirements), or that it
qualifies as a registrant whose securities may be resold pursuant to Form S-3
(at any time after it so qualifies), (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed by
the Company, and (iii) such other information as may be reasonably requested in
availing any Holder of any rule or regulation of the SEC that permits the
selling of any such securities without registration or pursuant to such form.
1.9 LIMITATIONS ON SUBSEQUENT REGISTRATION RIGHTS. From and after
the date of this Agreement, the Company shall not, without the prior written
consent of the Holders of a majority of the outstanding Registrable Securities,
enter into any agreement with any holder or prospective holder of any securities
of the Company that would allow such holder or prospective holder to (a) include
such securities in any registration statement filed by the Company unless such
registration rights are subordinate to, or (in the case of Common Stock issuable
upon conversion of Preferred Stock issued for cash ("PREFERRED INVESTOR
CONVERSION SHARES")) pro rata with (based on the relative number of shares
owned), the registration rights granted to the Holders pursuant to this
Agreement or (b) demand registration of other securities other than demand
registration rights of Preferred Investor Conversion Shares provided both (i)
the Holders are entitled to participate in any such demand registration on a pro
rata basis (based on the relative number of shares owned) and (ii) that neither
the granting nor exercise of such demand rights adversely affect number or
manner of the exercise of the Holders' rights under Section 1, which shall
continue in effect as an independent right of the Holders.
1.10 "MARKET STAND-OFF" AGREEMENT. The Investor hereby agrees that,
during the period specified by the Company and an underwriter of common stock or
other securities of the Company, following the effective date of a registration
statement of the Company filed under the Securities Act, it shall not, to the
extent requested by the Company and such underwriter, directly or indirectly
sell, offer to sell, contract to sell (including, without limitation, any short
sale), grant any option to purchase or otherwise transfer or dispose of (other
than to donees who agree to be similarly bound) any securities of the Company
held by it at any time during such period except Common Stock included in such
registration; provided, however, that:
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(a) such agreement shall be applicable only to the Company's initial
public offering of Equity Securities and shall not apply to the sale of any
Equity Securities to an underwriter pursuant to an underwriting agreement.
(b) all officers and directors of the Company and all other persons
with registration rights (whether or not pursuant to this Agreement) enter into
similar agreements; and
(c) such market stand-off time period shall not exceed 180 days.
In order to enforce the foregoing covenant, the Company may impose stop-transfer
instructions with respect to the Registrable Securities of the Investor (and the
shares or securities of every other person subject to the foregoing restriction)
until the end of such period and each Holder agrees that, if so requested, such
Holder will execute an agreement in the form provided by the underwriter
containing terms which are essentially consistent with the provisions of this
Section 1.10. Notwithstanding the foregoing, the obligations described in this
Section 1.10 shall not apply to a registration relating solely to employee
benefit plans on Form S-l or Form S-8 or similar forms which may be promulgated
in the future, or a registration relating solely to a Commission Rule 145
transaction on Form S-4 or similar forms which may be promulgated in the future.
1.11 ASSIGNMENT. The rights to cause the Company to register
Registrable Securities pursuant to this Section 1 may be assigned by a Holder to
a Transferee of such securities who, after such assignment, holds at least 25%
of the Registrable Securities then outstanding or is a majority-owned subsidiary
of such Holder or any majority owner of such Holder, provided: (a) the Company
is, within a reasonable time prior to such Transfer, furnished with written
notice of the name and address of such Transferee and the securities with
respect to which such registration rights are being assigned; and (b) such
Transferee agrees in writing to be bound by the terms and conditions of this
Section 1, including without limitation the provisions of Section 1.10. For the
purposes of determining the number of shares of Registrable Securities held by a
Transferee, the holdings of transferees of a partnership who are partners or
retired partners of such partnership (including spouses and ancestors, lineal
descendants and siblings of such partners or spouses who acquire Registrable
Securities by gift, will or intestate succession) shall be aggregated together
and with the partnership; provided that all assignees who would not qualify
individually for assignment of registration rights shall have a single
attorney-in-fact for the purpose of exercising any rights, receiving notices or
taking any action under this Section 1.
1.12 AMENDMENT AND WAIVER. This Section 1 (and Section 7 or 8,
insofar as it applies to this Section 1) may be amended, and the observance
thereof waived in any respect, with (and only with) the prior written consent of
the Company and the holders of a majority of the Registrable Securities then
outstanding.
1.13 TERMINATION. No Holder shall be entitled to exercise any right
provided for in this Section 1 after 3 years following upon the earliest of: (i)
the consummation of a Qualifying IPO; and (ii) the Company becoming subject to
the periodic reporting requirements of Section 12(g) or 15(d) of the Exchange
Act.
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2. Information Rights
2.1 DELIVERY OF FINANCIAL STATEMENTS. So long as the Investor
continues to hold at least 528,000 Common Equivalent Shares (as adjusted for
stock splits, reverse stock splits, stock dividends and the like occurring after
the date hereof), the Company shall deliver to the Investor:
(a) as soon as practicable, but in any event within 90 days after
the end of each fiscal year of the Company, an income statement for such fiscal
year, a balance sheet of the Company and statement of stockholder's equity as of
the end of such year, and a statement of cash flows for such year, such year-end
financial reports to be in reasonable detail, prepared in accordance with
generally accepted accounting principles, and certified by independent public
accountants of nationally recognized standing selected by the Company;
(b) as soon as practicable, but in any event within 45 days after
the end of each of the first three quarters of each fiscal year of the Company,
an unaudited income statement, statement of cash flows for such fiscal quarter
and an unaudited balance sheet and a statement of stockholder's equity as of the
end of such fiscal quarter;
(c) an unaudited income statement and statement of cash flows and
balance sheet for and as of the end of such month, in reasonable detail, within
30 days of the end of each month;
(d) a budget for the next fiscal year, prepared on a monthly basis,
including balance sheets and statements of cash flows for such months, as soon
as practicable, but in any event within 30 days after the beginning of such
fiscal year.
2.2 INSPECTION. So long as the Investor continues to hold at least
528,000 Common Equivalent Shares (as adjusted for stock splits, reverse stock
splits, stock dividends and the like occurring after the date hereof), the
Company shall permit the Investor, at the Investor's expense, to visit and
inspect the Company's properties, to examine its books of account and records
and to discuss the Company's affairs, finances and accounts with its officers,
all at such reasonable times as may be requested by the Investor; provided,
however, that the Company shall not be obligated pursuant to this Section 2.2 to
provide access to any information that it reasonably considers to be a trade
secret or similar confidential information.
2.3 ASSIGNMENT. The rights the Investor under this Section 1 may be
assigned and reassigned to a transferee of Common Equivalent Shares who holds,
after such assignment, at least 528,000 Common Equivalent Shares (as adjusted
for stock splits, reverse stock splits, stock dividends and the like occurring
after the date hereof) or is a majority-owned subsidiary of such assignor or any
majority owner of such assignor, provided the Company is, within a reasonable
time prior to such transfer, furnished with written notice of the name and
address of such transferee or assignee. For the purposes of determining the
number of Common Equivalent Shares held by a transferee, the holdings of
transferees of a partnership who are partners or retired partners of such
partnership (including spouses and ancestors, lineal descendants and siblings of
such partners or spouses who acquire Registrable Securities by gift, will or
intestate
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succession) shall be aggregated together and with the partnership; provided that
all assignees who would not qualify individually for assignment of rights under
this Section 2 shall have a single attorney-in-fact for the purpose of
exercising any rights, receiving notices or taking any action under this Section
2.
2.4 AMENDMENT AND WAIVER. This Section 2 (and Section 7 or 8,
insofar as it applies to this Section 2) may be amended, and the observance
thereof waived in any respect, with (and only with) the prior written consent of
the Company and the holder of at least 528,000 Common Equivalent Shares (as
adjusted for stock splits, reverse stock splits, stock dividends and the like
occurring after the date hereof).
2.5 TERMINATION. The rights set forth in this Section 2 shall
terminate and be of no further force or effect after the first to occur of (i)
the consummation of a Qualifying IPO or (ii) the Company first becomes subject
to the periodic reporting requirements of Sections 12(g) or 15(d) of the
Exchange Act.
3. Percentage Maintenance
3.1 NOTICE. Whenever the Company proposes to issue any Equity
Securities, the Company shall deliver a notice by certified mail (the "FIRST
OFFER NOTICE") to Investor, or each of its assignees that hold at least 200,000
Common Equivalent Shares (a "PARTICIPATING HOLDER") stating (i) its bona fide
intention to issue Equity Securities, (ii) the number of Equity Securities to be
issued, and (iii) the price and terms, if any, upon which it proposes to issue
such Equity Securities.
3.2 ELECTION. By written notification received by the Company within
10 days after giving the First Offer Notice, each Participating Holder may elect
to purchase or obtain, at the price and on the terms specified in the First
Offer Notice, up to such Participating Holder's Pro-Rata Portion of such Equity
Securities.
3.3 CONSUMMATION The Company may, during the 90-day period following
the expiration of the period provided in Section 3.2, offer the remaining
unsubscribed portion of such Equity Securities to any Person or Persons at a
price not less than, and upon terms no more favorable to the offeree than those
specified in the First Offer Notice. If the Company does not enter into an
agreement for the sale of the Equity Securities within such period, or if such
agreement is not consummated within 60 days of the Company's entry into any such
agreement, the right provided in this Section 3 shall be revived and such Equity
Securities shall not be issued unless first reoffered in accordance with this
Section 3.
3.4 EXCLUDED TRANSACTIONS. The right of first offer in this Section
3 shall not apply to (i) the issuance of up to 750,000 shares of Common Stock or
options therefor (as adjusted for stock splits, reverse stock splits, stock
dividends and the like occurring after the date hereof, and including in such
750,000 shares all options outstanding on the date hereof) to employees or
directors of or consultants to the Company pursuant to a stock option plan
approved by the Company's board of directors, (ii) a Qualifying IPO, (iii) the
issuance of securities pursuant to the conversion, exercise or exchange of
convertible, exercisable or
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exchangeable Equity Securities whose issuance was subject to this Section 3, or
pursuant to conversion of the Preferred Shares or (iv) the issuance of Equity
Securities in connection with bona fide equipment leasing or debt financing
transactions.
3.5 LIMITATION TO EXEMPT TRANSACTIONS. Notwithstanding any provision
above to the contrary, the right of first offer pursuant to this Section 3 is
only granted to such Persons who may exercise such right in a transaction exempt
from the registration requirements of the Securities Act.
3.6 ASSIGNMENT. Any direct or indirect transferee of Common
Equivalent Shares shall automatically, without further action, succeed to the
rights of the Investor or other transferor under this Section 3 with respect to
the transferred Common Equivalent Shares, subject to the limitation that such
rights can be exercised only if such transferee meets the definition of a
Participating Holder, and subject to the other limitations stated in this
Section 3. For purposes of determining a holder's status as a Participating
Holder, its holdings shall be aggregated with the holdings of its partners and
affiliates, and the exercise of rights under this Section 3 may be apportioned
among itself and its partners and affiliates in such proportions as it deems
appropriate. The rights under this Section 3 are not otherwise assignable.
3.7 AMENDMENT, WAIVER. This Section 3 can be amended, and its
observance waived in any respect, with and only with the prior written consent
of the Company and holders of a majority of the Common Equivalent Shares then
held by all Persons who then meet the definition of a Participating Holder.
3.8 TERMINATION. The rights set forth in this Section 3 shall
terminate and be of no further force or effect after the first to occur of (i)
the consummation of a Qualifying IPO or (ii) the Company first becomes subject
to the periodic reporting requirements of Sections 12(g) or 15(d) of the
Exchange Act.
[4. Right of Co-Sale]
4.1 NOTICE. In the event that any Existing Holder (the "SELLING
HOLDER") proposes to Sell to any Person other than the Company any of his Equity
Securities (the "OFFERED SHARES"), the Selling Holder shall give written notice
at least 20 days before the proposed closing date to each Participating Holder
(the "CO-SALE NOTICE"). The Co-Sale Notice shall describe in detail the proposed
Sale, including the number of Equity Securities proposed to be Sold, the Sale
price or consideration to be paid or received and the name and address of the
proposed buyer.
4.2 ELECTION PROCEDURE. The Participating Holder shall have the
right to sell to the proposed buyer a number of its Common Equivalent Shares
equal to the Investor's Pro Rata Portion of the Offered Shares. The
Participating Holder may exercise such right by (and only by) delivering a
notice of election (the "ELECTION NOTICE") to the Selling Holder within 10 days
after the date the Co-Sale Notice has been delivered to the Investor. The
Participating Holder shall specify in the Election Notice the number of shares
of Common Stock, not exceeding the
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Participating Holder's Pro-Rata Portion of the Offered Shares, the Investor
desires to sell (the "ELECTED NUMBER").
4.3 SALE TO SELLING HOLDER. If the Transferee is unwilling to
purchase Common Stock directly from the Investor, the Participating Holder shall
have the right to sell directly to the Selling Holder such Participating
Holder's Elected Number of shares of Common Stock proposed to be Transferred.
4.4 CLOSING. The closing of the sale of Common Stock by the Investor
to the Transferee or to the Selling Holder, as appropriate, shall occur on the
date of the Transfer of shares of Common Stock to the Transferee, if such
Transfer occurs. At such closing, the Participating Holder shall surrender its
certificates representing the Common Stock to be sold, and the Transferee or the
Selling Holder, as appropriate, shall pay to the Participating Holder in
immediately available funds an amount equal to the product of (a) the number of
shares Common Stock to be sold by the Participating Holder, multiplied by (b)
the price per share identified in the Co-Sale Notice.
4.5 CONSUMMATION OF SALE. The Selling Holder may, within 30 days
after delivery of the Co-Sale Notice, conclude the Sale of any or all of his
Equity Securities covered by the Co-Sale Notice on terms and conditions not
materially more favorable to the transferor than those described in the Co-Sale
Notice. Any proposed Sale on terms and conditions more favorable to the
transferor than those described in the Co-Sale Notice, as well as any proposed
Sale by the Selling Holder of any Equity Securities after the expiration of such
30-day period, shall again be subject to this Section 4.
4.6 OTHER TRANSFERS. The provisions of this Section 4 shall not
apply to a Transfer other than a Sale, but it shall be a condition of any such
Transfer that (a) the Company is, within a reasonable time prior to such
transfer, furnished with written notice of the name and address of such
transferee and the securities being so Transferred; and (b) such Transferee
agrees in writing to be bound by the terms and conditions of this Section 4.
4.7 SHARES SUBJECT TO THIS SECTION 4. This Section 4 shall apply to
any Equity Securities in which an Existing Holder or a Related Party of an
Existing Holder at any time holds or acquires a beneficial interest in, and
shall continue to apply to any direct or indirect Transferee of any such Equity
Securities other than a buyer in a Sale. All certificates representing Equity
Securities subject to the restrictions of this Section 4 shall bear an
appropriate legend with respect to such restrictions.
4.8 ASSIGNMENT. Any direct or indirect transferee of Common
Equivalent Shares shall automatically, without further action, succeed to the
rights of the Investor or other transferor under this Section 4 with respect to
the transferred Common Equivalent Shares, subject to the limitation that such
rights can be exercised only if such transferee meets the definition of a
Participating Holder, and subject to the other limitations stated in this
Section 4. For purposes of determining a holder's status as a Participating
Holder, its holdings shall be aggregated with the holdings of its partners and
affiliates, and the exercise of rights under this Section 4 may be
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apportioned among itself and its partners and affiliates in such proportions as
it deems appropriate. The rights under this Section 4 are not otherwise
assignable.
4.9 AMENDMENT, WAIVER. This Section 4 can be amended, and its
observance waived in any respect, with and only with the prior written consent
of the Company and holders of a majority of the Common Equivalent Shares then
held by all Persons who then meet the definition of a Participating Holder.
4.10 TERMINATION. The rights set forth in this Section 4 shall
terminate and be of no further force or effect after the first to occur of (i)
the consummation of a Qualifying IPO or (ii) the Company first becomes subject
to the periodic reporting requirements of Sections 12(g) or 15(d) of the
Exchange Act.
4.11 EXCLUSION. The rights set forth in this Section 4 shall not
apply to the single sale transfer by ▇▇▇▇ ▇▇▇▇▇▇▇ of up to, but not exceeding
200,000 shares of Common Stock to ▇▇▇▇▇▇▇ II, LLC for an ownership interest in
such entity.
5. Board Representation.
5.1 ELECTION OF INVESTOR DESIGNEE. So long as the Investor holds at
least 528,000 Common Equivalent Shares (as adjusted for stock splits, reverse
stock splits, stock dividends and the like occurring after the date hereof), the
Existing Holders agree to vote or act with respect to all capital stock of the
Company now or hereafter held by either of them entitled to vote in the election
of directors ("VOTING SHARES") so as to elect to the Company's Board of
Directors one member designated by the Investor. Any remaining directors shall
be elected by the holders of the Common Stock and Preferred Stock, voting
together as a single class on an as converted to common stock basis.
5.2 VACANCY, REMOVAL. In the event of any vacancy on the Board of
Directors, the Existing Holders will vote or act with respect to their Voting
Shares so as to fill such vacancy with a nominee designated in the same manner
as the person who held the directorship so vacated. The parties hereto agree
that no director may be removed from office without the approval of the
shareholders entitled to designate such directors in accordance with Section
5.1.
5.3 DISCLAIMER. Neither the Company, the Existing Holders, the
Investor nor any officer, director, stockholder, partner, employee or agent of
such party makes any representation or warranty as to the fitness or competence
of the designee of any party hereunder to serve on the Company's Board by virtue
of such party's execution of this Agreement or by the act of such party in
designating or voting for such designee pursuant to this Section 5.
5.4 SHARES SUBJECT TO THIS SECTION 5. This Section 5 shall apply to
any Voting Shares in which an Existing Holder or a Related Party of an Existing
Holder at any time holds or acquires a beneficial interest in, and shall
continue to apply to any direct or indirect Transferee of any such Voting
Shares. All certificates representing Voting Shares subject to this Section 5
shall bear an appropriate legend with respect to this Section 5.
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5.5 ASSIGNMENT. The rights the Investor under this Section 5 may be
assigned and reassigned to a transferee of Common Equivalent Shares who holds,
after such assignment, at least 528,000 Common Equivalent Shares (as adjusted
for stock splits, reverse stock splits, stock dividends and the like occurring
after the date hereof) or is a majority-owned subsidiary of such assignor or any
majority owner of such assignor, provided the Company is, within a reasonable
time prior to such transfer, furnished with written notice of the name and
address of such transferee or assignee. For the purposes of determining the
number of Common Equivalent Shares held by a transferee, the holdings of
transferees of a partnership who are partners or retired partners of such
partnership (including spouses and ancestors, lineal descendants and siblings of
such partners or spouses who acquire Registrable Securities by gift, will or
intestate succession) shall be aggregated together and with the partnership.
5.6 AMENDMENT AND WAIVER. This Section 5 (and Section 7 or 8,
insofar as it applies to this Section 5) may be amended, and the observance
thereof waived in any respect, with (and only with) the prior written consent of
the Company and the holder of at least 528,000 Common Equivalent Shares (as
adjusted for stock splits, reverse stock splits, stock dividends and the like
occurring after the date hereof).
5.7 TERMINATION. The rights set forth in this Section 5 shall
terminate and be of no further force or effect after the first to occur of (i)
the consummation of a Qualifying IPO or (ii) the Company first becomes subject
to the periodic reporting requirements of Sections 12(g) or 15(d) of the
Exchange Act.
6. Additional Covenants.
6.1 EMPLOYEE AND OTHER STOCK ARRANGEMENTS. Except as otherwise
approved by the Company's Board of Directors, all Equity Securities sold or
granted to employees, consultants or other service providers of the Company
henceforth shall vest ratably over 4 years following sale or grant, provided
that the initial vesting of 25% of the Equity Securities so sold or granted
shall not occur sooner than the first anniversary of the buyer's or grantee's
employment by the Company. Furthermore, all Equity Securities sold or granted to
employees, consultants or other service providers of the Company holding more
than 5% of the outstanding stock of the Company on a fully diluted basis
henceforth shall be subject to a market standoff provision at least as
restrictive as Section 1.10. This Section 6.1 (and Section 7 or 8, insofar as it
applies to this Section 6.1) may be amended, and the observance thereof waived
in any respect, with (and only with) the prior written consent of the Company
and the holder of a majority of the Common Equivalent Shares then outstanding.
This Section 6.1 shall terminate and be of no further force or effect after the
first to occur of (i) the consummation of a Qualifying IPO or (ii) the Company
first becomes subject to the periodic reporting requirements of Sections 12(g)
or 15(d) of the Exchange Act.
6.2 INDEMNIFICATION. The Company covenants to keep in full force and
effect an indemnification agreement in the form attached as Exhibit A.
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7. General
7.1 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the Company and the Investor relating to the subject matter
hereof. Any previous agreement or negotiations between the Company and the
Investor concerning the subject matter of this Agreement is superseded by this
Agreement.
7.2 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of Delaware.
7.3 LITIGATION. Each party to this Agreement irrevocably consents
and submits to the jurisdiction of the federal and state courts sitting in San
Mateo County, California in any action or proceeding arising out of or relating
to this Agreement or the consummation of the transactions contemplated in this
Agreement. Each party irrevocably: (a) agrees that all claims in respect of any
such action or proceeding may be heard and determined in these courts; (b)
waives any objection that such party now or hereafter may have to the laying of
venue for any action or proceeding arising out of or relating to this Agreement
brought in the aforementioned courts; and (c) agrees to consent to transfer of
any action involving the parties to such forum based on the convenience and
interest of the parties.
7.4 COUNTERPARTS; FACSIMILE. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. A facsimile copy of
an executed signature page shall be deemed an original.
7.5 NOTICES. Any notice required or permitted under this Agreement
shall be given in writing and shall be conclusively deemed given upon actual
receipt if given by hand delivery, overnight courier, mail or facsimile
transmission addressed:
if to the Company, to:
▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇, L.L.C.
▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ (84101)
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
fax: (▇▇▇) ▇▇▇-▇▇▇▇
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if to the Investor, to:
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, M/S 5op738
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇ ▇▇▇▇▇▇
McCutchen, Doyle, ▇▇▇▇▇ & Enersen, LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
fax: (▇▇▇) ▇▇▇-▇▇▇▇
if to a Shareholder, to:
c/o Tomax technologies, inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇, L.L.C.
▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ (84101)
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
fax: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address as the Company, the Investor or the Existing Holders
may designate by 10 days prior written notice to the other parties to this
Agreement.
7.6 SEVERABILITY. If any provision of this Agreement, or the
application thereof, is for any reason and to any extent determined by a court
of competent jurisdiction to be invalid or unenforceable, the remainder of this
Agreement and the application of such provision to other Persons or
circumstances will be interpreted so as best to effect the intent of the parties
to this Agreement to the maximum permissible extent. The parties agree to use
their best efforts to replace such void or unenforceable provision of this
Agreement with a valid and enforceable provision that will achieve, to the
extent greatest possible, the economic, business and other purposes of the void
or unenforceable provision.
7.7 CONSTRUCTION. The headings of the Sections of this Agreement are
for convenience and shall not be considered in the interpretation of this
Agreement. The words
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"hereof," "hereunder" and similar words refer to this Agreement as a whole and
not to any subdivision contained in this Agreement. References herein to a
Section refer to the designated Section of this Agreement. In construing the
terms of this Agreement, no presumption shall operate in favor of or against any
party as a result of its counsel's role in drafting this Agreement.
7.8 SPECIFIC PERFORMANCE. In addition to any and all other remedies
that may be available at law in the event of any breach of this Agreement, the
Investor shall be entitled to specific performance of the agreements and
obligations of the Company and the Existing Holders hereunder and to such other
injunctive or other equitable relief as may be granted by a court of competent
jurisdiction.
7.9 SUCCESSORS. This Agreement shall be binding upon and inure to
the benefit of any successor to the Company or the Company's business.
8. Glossary
AGREEMENT -- this Investor Rights Agreement, as it may be amended
from time to time in accordance with its terms.
COMMON EQUIVALENT SHARES -- (i) the Common Shares owned by a holder,
(ii) the shares of Common Stock owned by such holder originally issued upon
conversion of Preferred Shares and (iii) the shares of Common Stock issuable
upon conversion of Preferred Shares owned by such holder.
COMMON SHARES -- introductory paragraphs.
COMMON STOCK -- introductory paragraphs.
COMPANY -- introductory paragraphs.
CO-SALE NOTICE -- Section 4.1.
ELECTED NUMBER -- Section 4.2.
ELECTION NOTICE -- Section 4.2.
EQUITY SECURITIES -- any capital stock of the Company, and any
security, instrument or right conferring a right to convert into, exchange for
or acquire any capital stock of the Company.
EXCHANGE ACT -- the Securities Exchange Act of 1934, as amended.
EXISTING HOLDERS -- introductory paragraphs.
FIRST CLOSING -- Section 1.1.
FIRST OFFER NOTICE -- Section 3.1.
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FORM S-3 -- Form S-3 under the Securities Act, as in effect on the
date hereof, and any registration form subsequently adopted under the Securities
Act which permits inclusion or incorporation of substantial information by
reference to other documents filed by the Company with the SEC.
HOLDER -- (i) the Investor with respect to the Registrable
Securities held by it, and (ii) any Person owning or having the right to acquire
Registrable Securities to whom rights under Section 1 have been assigned in
accordance with Section 1.10.
INITIATING HOLDER -- Section 1.1(b).
INVESTOR -- introductory paragraphs.
OFFERED SHARES -- Section 4.1.
PERSON -- any corporation, general partnership, limited partnership,
limited liability company, business trust, association, organization, entity,
individual or a governmental agency.
PREFERRED INVESTOR CONVERSION SHARES -- Section 1.9.
PREFERRED SHARES -- introductory paragraphs.
PREFERRED STOCK -- introductory paragraphs.
PRO RATA PORTION -- the proportion that the number of Common
Equivalent Shares then held by the Person in question bears to the total number
of shares of Common Stock then outstanding (assuming full conversion, exercise
and exchange of all convertible, exercisable or exchangeable securities and
rights then outstanding).
RELATED PARTY -- with respect to any Person, any spouse or
descendent of such Person or any entity in which such Person or any spouse or
descendent of such Person holds a majority of the beneficial interest.
QUALIFYING IPO -- a bona fide, firmly underwritten public offering
of shares of Common Stock, registered under the Securities Act pursuant to a
registration statement on Form S-1 or SB-2 with a per share price of at least
$14.83 (subject to adjustment) and a minimum aggregate purchase price of at
least $5,000,000.
REGISTRABLE SECURITIES -- (i) the Common Shares, (ii) the Common
Stock issuable or issued upon conversion of the Preferred Shares, and (iii) any
common stock issued or distributed with respect to Common Stock otherwise
constituting Registrable Securities. Securities shall cease to be Registrable
Securities when (1) a registration statement covering such Registrable
Securities has been declared effective and they have been disposed of pursuant
to such effective registration statement, (2) they are transferred on the open
market pursuant to any available exemption under the Act, or (3) they have been
sold, assigned, pledged, hypothecated
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or otherwise disposed of by the Holder in a transaction in which the Holder's
rights under Section 1 are not assigned or assignable.
SALE and SELL -- a Transfer for valuable consideration. A pledge,
hypothecation, mortgage or other encumbrance shall not constitute a Sale, but
any exercise of a power of sale thereunder shall constitute a Sale.
SEC -- the Securities and Exchange Commission, and any successor
agency under the Securities Act.
SECURITIES ACT -- the Securities Act of 1933, as amended.
SELLING HOLDER -- Section 4.1.
STOCK PURCHASE AGREEMENT -- introductory paragraphs.
TRANSFER -- any sale, exchange, delivery, assignment, disposal,
gift, pledge, hypothecation, mortgage or other encumbrance or transfer, in each
case for any consideration or no consideration and whether voluntary or
involuntary.
TRANSFEREE -- the recipient in any Transfer.
VIOLATION -- Section 1.7(a).
VOTING SHARES -- Section 5.1.
[signature page follows]
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In witness whereof, the parties have executed this Investor Rights
Agreement.
COMPANY: TOMAX TECHNOLOGIES, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: CEO and President
PURCHASER: ORACLE CORPORATION
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Senior Vice President, Corporate Development
SHAREHOLDERS: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------
▇▇▇▇ ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇ ▇▇▇▇▇▇
/s/ ▇▇▇▇▇ Low
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▇▇▇▇▇ Low
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